Minimum wage 'will offer comprehensive longer-term solution'

SINGAPORE - The controversial issue of a minimum wage surfaced in Parliament again yesterday, after MP Inderjit Singh (Ang Mo Kio GRC) repeated a call he had made in previous years to introduce a national salary floor.

Back in 2013, Mr Singh had asked the Government to help with making a five-year transition to a minimum wage of $1,500 monthly.

But labour chief Lim Swee Say had rejected the idea at the time, saying that Singapore's combination of wage subsidies and skills training for low-income earners was more effective to raise incomes at the low end.

Undaunted, Mr Singh said in yesterday's Budget debate that while he acknowledged the continuing efforts to boost the pay of low-wage workers, a minimum wage across the board was still necessary so that those with the lowest salaries will not need to rely on continual state aid.

"A Singaporean earning very low wages - who has a family to support - cannot cope with unrealistically low salaries," he said.

"We should formalise a national minimum wage so that Singaporeans are more self-sufficient and don't have to rely on regular government interventions to help them cope."

One measure the Government has put in place to help low-income workers is the Progressive Wage Model (PWM), which prescribes a minimum wage in certain industries.

Launched in 2012, the PWM has been implemented in the cleaning industry and will apply to the security sector next year.

Mr Singh recognised that the PWM has helped Singaporeans to cope with the rising cost of living, but feels the scheme "does not provide the comprehensive longer-term solution that is needed".

"Some companies have gotten around the PWM by reclassifying jobs in the two sectors affected by it, while employers in sectors not covered by the progressive wage model have little incentive to redesign their jobs," he said.

In a separate speech, Nominated MP K. Karthikeyan encouraged companies to boost productivity under the PWM so that workers can carry out their jobs more effectively and efficiently.

This will lead to real, sustainable wage increases, he said.

"We need companies to be more forthcoming in identifying gaps, redesigning work, reviewing work processes, innovating and developing new products and services; only then can we be more hopeful that we can have a quantum-leap improvement in productivity," he added.

Mr Karthikeyan, who is a vice-president at the National Trades Union Congress, had previously suggested applying the PWM to more sectors, ahead of starting his term as NMP in August last year.

This article was first published on March 5, 2015. Get a copy of The Straits Times or go to straitstimes.com for more stories.